Question
A company just issued a bond with the following characteristics: Maturity = 3 years Coupon rate = 8% Face value = $1,000 YTM = 10%
A company just issued a bond with the following characteristics: Maturity = 3 years Coupon rate = 8% Face value = $1,000 YTM = 10% Interest is paid annually and the bond is noncallable.
Calculate the bonds Macaulay duration ?Round "Present value" to 2 decimal places and "Duration" to 4 decimal place.?
Calculate the bonds modified duration
Assuming the bonds YTM goes from 10% to 9.5%, calculate an estimate of the price change without considering convexity
Calculate the convexity of the bond.
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Personal Finance
Authors: Jack Kapoor, Les Dlabay, Robert J. Hughes
11th edition
9781259278617, 77861647, 1259278611, 978-0077861643
